/ Miliband and the Economy

I'm no economist or financial expert but, thinking about Milibands "promise" to freeze energy prices I can see any one or a combination of a number of scenarios. The freezing of prices is going to result in the industries having less money for future investments. This will ultimately result in lower returns for the companies and ultimately for the shareholders. Shareholders will not be prepared to risk investing their money in the energy companies and the share values of these companies will plummet. Consequently anyone who has any sort of investment portfolios for their savings will loose out as their savings are eroded by falling share values.

The time to announce a price freeze is the day or the day before you intend to impose it. As it is now the energy companies have eighteen months to increase their prices to minimize the impact of the "freeze". When the freeze is lifted, watch the prices rocket.

This may be a simplistic layman's view but I really think there is only one reason why Miliband has done this and that is to persuade those non saving and non shareholding voters to vote for him.

My instinct says that what he said was a) populist and b) bonkers, the usual combination.

There is a point in there somewhere though. The market for utilities is completely dysfunctional resulting in the complete ripping off of everyone while a few people cream off fat profits; so I think the govt should step in and, you know, do something about it. But not this.

I don't really understand how a market in things that are entirely uniform (there must be a fancy economics word for this) are even meant to work in the first place. If I sell cakes, I can compete with other cake sellers by having better or different cakes at a price set by the supply and demand curves. But with utilities the only element of the product that a consumer can choose is, by simple matter of fact, how much you're getting ripped off by. Which of course no one will tell you, so is it any wonder that the market is dysfunctional and everyone's getting ripped off?

But that will have the effect of shareholders withdrawing their capital which is supposed to foster investment and help people's savings. Otherwise an obvious choice for a left leaning Labour government.

> (In reply to Jon Stewart)
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> But that will have the effect of shareholders withdrawing their capital which is supposed to foster investment and help people's savings. Otherwise an obvious choice for a left leaning Labour government.

I don't know the answer, but does our entire economy depend on the utility companies' invetsment behaviour? Isn't our economy large enough to absorb the impact? I imagine that renationalisation is a complete nightmare from a pragmaic 'flowchart of tasks' point of view, but might the short-term losses not be outweighed by the positive economic effects of releasing a load of people's expendable income from being poured down the drain of a dysfunctional market?

> There is a point in there somewhere though. The market for utilities is completely dysfunctional resulting in the complete ripping off of everyone while a few people cream off fat profits;

Actually we have some of the cheapest power in Europe and the G7 and power companies with a remarkably low margin already. That is despite a very substantial "green" burden imposed a few years ago by a particularly useless Energy secretary, one E Milliband, via some virtually useless windmills, who in addition to having the economic sense of a 6 year old child, also seems to have the memory of a goldfish and thinks that we do do. Quite apart from entirely gratuitously attacking a very important economic sector with a baseless hate campaign.

Yes, because state enterprises have such a wonderful record of customer service, especially when they have a monopoly.

What incidentally, is the next important area of economic activity that he and his cohorts are going to wreck? Because whatever they decide to vilify, we can be sure it will have little to do with any facts and everything to do with atavistic class-hatred and big-state authoritarianism.

> That is despite a very substantial "green" burden imposed a few years ago by a particularly useless Energy secretary, one E Milliband, via some virtually useless windmills, who in addition to having the economic sense of a 6 year old child, also seems to have the memory of a goldfish and thinks that we do do. Quite apart from entirely gratuitously attacking a very important economic sector with a baseless hate campaign.

Fair enough, I'm not going to defend his record - but I don't think that the attack on the sector is much of an issue. We all hate the utilities companies because they rip us off, provide appalling customer service and unlike the retail sector they sell us something that we get no joy out of consuming. And when I say rip us off, what I mean is that they give a choice of tariffs which provides an opportunity to gamble (thanks!) and they tell us that price rises are due to wholesale prices which can't be the case because they don't go down. As consumers, we get no meaningful choice (we simply need the product) and we get lied to, and we get put on hold for f^cking eternity when we need to speak to someone. As far as a hate campaign goes, I don't think it's entirely baseless.

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> Yes, because state enterprises have such a wonderful record of customer service, especially when they have a monopoly.

The idea that the utilities market has driven up standards of customer service is ludicrous. We haven't tried state enterprises like this for a while, the world has moved on and we don't know what the end product for the consumer would be like. I'd be prepared to take a chance given what the market has delivered. I guess it could be even worse, but at least we wouldn't be told to be grateful for the opportunity to pointlessly gamble with the bills, weighing up the cost of the hassle of switching (massive, given the appalling customer service common to all suppliers) against an unknown return, when all we want is a single, cheap price and no hassle.

> What incidentally, is the next important area of economic activity that he and his cohorts are going to wreck? Because whatever they decide to vilify, we can be sure it will have little to do with any facts and everything to do with atavistic class-hatred and big-state authoritarianism.

Do you think that his silly speech has wrecked a sector of the economy? You give him too much credit!

If I was in charge, I would start a (initially government-backed) not-for-profit energy company along the lines of Dwr Cymru (the Welsh not-for-profit water company). Their mandate would be simple: sell energy to consumers as cheaply as possible, while investing in power generation for the benefit of the UK. They would NOT be allowed to sell power at a loss, and they WOULD be required to make considerable investments in generation. The Government could assist in funding these strategic investments for the future, with the assumption that these investments would be repaid.

It might be that the capitalists are correct, that the company would be unable to sell energy more cheaply than than the 'big six', with their economic freedoms, and require occasional injections of Government money to keep them running. But at least we would be investing in building power generation capacity in a strategic way as needed by the country, not as needed by energy companies; if it turns out privatisation really was a good idea then some return could be made by selling this generation capacity back to the 'big six', and the not-for-profit slowly becomes a way of building generation capacity as we would like it.

Or it turns out that the energy companies really are screwing us over, the not-for-profit can sell us energy cheaper AND make better long-term investments, and slowly edge the expensive energy companies out of the market. Nationalisation by competition

OK so it would probably break all sorts of exciting EU competition laws unless done very carefully, but hey :P

OR....

Just make all energy payable in six-monthly arrears - you get your readings, and then the government auctions off your bill to the lowest bidder :P now THAT'S competition in action

Interesting ideas - there must be loads of ways of distributing energy that would work and don't involve an artificial market trading nothing but the perception that you're getting a good deal when you have no idea of the facts.

> (In reply to FesteringSore)
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> In reply to FesteringSore:
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> Their mandate would be simple: sell energy to consumers as cheaply as possible, while investing in power generation for the benefit of the UK.

Back in the nationalised industry CEGB days, the CEGB's mandate was to supply electricity every day of the year without fail.

> This will ultimately result in lower returns for the companies and ultimately for the shareholders.

Regarding shareholders, who is this a problem for other than themselves?

> Shareholders will not be prepared to risk investing their money in the energy companies and the share values of these companies will plummet.

Again, which is a problem for who?

> Consequently anyone who has any sort of investment portfolios for their savings will loose out as their savings are eroded by falling share values.

Sad for them. But I suspect the price cap isn't aimed at helping those who have enough money to chuck in to the stock market but those who stuggle to balance whether to pay heating bills or food bills.

> As it is now the energy companies have eighteen months to increase their prices to minimize the impact of the "freeze".

I expect they were just going to increase the prices anyway. Those shareholders need to get paid after all.

> This may be a simplistic layman's view ...

No doubt, and no doubt my view is simplistic too. I struggle to see why the general public should give two hoots about shareholders. Share returns and dividends just seem like an upward wealth re-distribution (with odd exceptions, such as pension etc).

> (In reply to FesteringSore)
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> Regarding shareholders, who is this a problem for other than themselves?
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> Again, which is a problem for who?
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> Sad for them. But I suspect the price cap isn't aimed at helping those who have enough money to chuck in to the stock market but those who stuggle to balance whether to pay heating bills or food bills.
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> I expect they were just going to increase the prices anyway. Those shareholders need to get paid after all.
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> No doubt, and no doubt my view is simplistic too. I struggle to see why the general public should give two hoots about shareholders. Share returns and dividends just seem like an upward wealth re-distribution (with odd exceptions, such as pension etc).

Are you stupid? The fact that somebody my have a bit of money invested does not necessarily mean, by any stretch of the imagination, that they are "loaded". They simply use such means in the hope that it will earn a little extra for them.

> Are you stupid? The fact that somebody my have a bit of money invested does not necessarily mean, by any stretch of the imagination, that they are "loaded". They simply use such means in the hope that it will earn a little extra for them.

Well... (ignoring the fact that arguably anyone living legally in the UK and entitled to benefits is, by the standard of a lot of people in the world, already 'loaded')

The current fraction of people in the UK holding shares is, as far a little bit of googling can show, around 16%. Now it is obviously not true that the 16% richest people in the UK and the 16% holding shares are the same people, but I suspect there is considerable overlap; I suspect very few people with less than the average income hold shares, for example. So if you hold shares, you are probably in the top quarter, by wealth, of a country which is itself extremely wealthy. 'Loaded' doesn't seem to extreme a word to me?

> (In reply to andrewmcleod)
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> Back in the nationalised industry CEGB days, the CEGB's mandate was to supply electricity every day of the year without fail.

Ah yes I remember it well, the GEGB used to plan stations decades ahead, have spares in stock, did regular planned preventative maintenance, had standard commodity codes across the industry for equipment that' could be interchangeable across a lot of their plant, meaning easy and quick repairs.

Now we have multifarious foreign owners that do the opposite, and milk it for what they can get, and will walk away and leave us all in the shite.

Or, if you believe thet rumours, their latest dodge seems to be to put run down stations into mothballs, and then hold the government to ransom to try and get public subsidy to repair them to take them back out, rather than fund repairs/ biomass conversions from their own profits (Tilbury has closed, but has it really?)

Then again we could all save a fortune if we released the companies from the green obligations, the Chinese, the Russians, India and others industrial giants are now the big emitters, ( who don't have the controls on 'greenhouse gases' )

our relatively tiny output would not even be statistically significant if it disappeared tomorrow, so dropping it would have no difference to the fate of the planet( which if you believe the warming argument, is in the hands of the aforementioned ) but dropping the green obligations could cut our bills more than a price freeze would. ( IF they pass it on of course)

Where did I say someone with shares is "loaded"? I have shares, I'm certainly not loaded. However I recognise that having the disposable income to risk in the stock market puts me in a category where I am unlikely to want for food or heating.

I certainly recognise that it puts me in a class where my desire for more money, by essentially doing nothing more than creatively shuffling around the money I have, should be secondary to the needs of those who cannot afford to heat their homes.

So stuff the shareholders as far as I'm concerned. I'd be interested to hear your viewpoints on the other points raised....popshot?

Really? I get the gas and electricity I pay for. What service do you need? The gas comes through the pipes and the electricity through the wires, as much as I want and when I want it. The last time I remeber it didn't was in the 70's when they were state owned monopolies.

> .. and unlike the retail sector they sell us something that we get no joy out of consuming. >

Don't you enjoy being warm when you put the heating on and having hot showers instead of cold ones? I also quite like being able to see after its gone dark and this computer wouldn't be much use without electricity.

> ..And when I say rip us off, what I mean is that they give a choice of tariffs which provides an opportunity to gamble ..........>

Now I'll grant you the tariffs are confusing and that's something the government could usefully sort out but if you get a dual fuel and pay by direct debit you're probably getting as reasonable a deal as anyone.

If you're bills are too much, the answer's simple, use less. As others have pointed out, we don't pay over the odds compared with other countries.
We seem to have developed a strange attitude in recent years that the most important things in life, energy, food, water etc should be very cheap so we can fritter the rest of our income on all the shit we don't need like Sky TV, ipods/pads/phones, flatscreen/widescreen/HD things to watch the crap on Sky with.
We are just about the first generation in history to have the luxury of not having to spend most of our income on essentials and we've chosen to squander it on filling our homes with energy hungry devices. With the rise in global population and the rise in living standards in many formerly very poor countries the demand for energy is only going to increase and whilst the sources of most of that energy remain finite that can only mean one thing for prices.
Enjoy the party while it lasts.

> Really? I get the gas and electricity I pay for. What service do you need?

I have no problem with the physical systems, which isn't the responsibility of the companies I'm moaning about. It's taking 8 years to sort out my bill (British Gas) and endless hours on hold ending in no satisfactory resolution of the issue (npower) that bothers me.

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> Don't you enjoy being warm when you put the heating on and having hot showers instead of cold ones? I also quite like being able to see after its gone dark and this computer wouldn't be much use without electricity.

No. Perhaps you have a more Buddhist outlook that me, but I expect these things, I don't enjoy them. When they work, it is neutral, when they fail, it is bad.

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> Now I'll grant you the tariffs are confusing and that's something the government could usefully sort out but if you get a dual fuel and pay by direct debit you're probably getting as reasonable a deal as anyone.

This is the crux. You can't have a market without confusing tariffs. It's a fake market *of* confusing tariffs.

> If you're bills are too much, the answer's simple, use less. As others have pointed out, we don't pay over the odds compared with other countries.
> We seem to have developed a strange attitude in recent years that the most important things in life, energy, food, water etc should be very cheap so we can fritter the rest of our income on all the shit we don't need like Sky TV, ipods/pads/phones, flatscreen/widescreen/HD things to watch the crap on Sky with.

It's not the absolute price that bothers me, I'll accept whatever price it comes to when I believe it is being distributed to me using the most efficient possible system. I do no believe that the fake market with 6 different companies profits and running costs to pay for is the most efficient system, so I think it is too expensive relative to what I consider to be the true price.

> (In reply to teflonpete)
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> Ah yes I remember it well, the GEGB used to plan stations decades ahead, have spares in stock, did regular planned preventative maintenance, had standard commodity codes across the industry for equipment that' could be interchangeable across a lot of their plant, meaning easy and quick repairs.
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> Now we have multifarious foreign owners that do the opposite, and milk it for what they can get, and will walk away and leave us all in the shite.
>
> Or, if you believe thet rumours, their latest dodge seems to be to put run down stations into mothballs, and then hold the government to ransom to try and get public subsidy to repair them to take them back out, rather than fund repairs/ biomass conversions from their own profits (Tilbury has closed, but has it really?)
>
> Then again we could all save a fortune if we released the companies from the green obligations, the Chinese, the Russians, India and others industrial giants are now the big emitters, ( who don't have the controls on 'greenhouse gases' )
>
> our relatively tiny output would not even be statistically significant if it disappeared tomorrow, so dropping it would have no difference to the fate of the planet( which if you believe the warming argument, is in the hands of the aforementioned ) but dropping the green obligations could cut our bills more than a price freeze would. ( IF they pass it on of course)
>
> Yes I am cynical.

It's fair enough to be cynical about what politicians and businesses with vested interests have to say.

But if climate scientists say that it's 95% likely that humans have caused the warming already seen and the implications for the future are x,y and z, then I don't see any justification for not believing them. No one in the universe is better qualified to make a judgement that a consensus of the earth's climate scientists. Do you honestly think they've all got shares in eco-business and that's what's behind it?

It would be more convenient if the scientists were wrong, but the best guess probability of that is 5% (and that's a consensus of people who've spent their careers working out that number). Why put your eggs in the 5% basket rather than the 95%? Seems absolutely irrational to me.

As for policies to address(?!) the issue, golly yes what a minefield. But I think that the very controversial matter of what policies to put in place given the impossible situation that the big emitters include China, India Brazil is all too often confused with the entirely factual scientific matter of what's happening. In order to justify a "we shouldn't do anything because of China and India" position, you seem to add "and I don't believe the science anyway". The first part is a matter of policy worthy of discussion, the last part is a dangerous denial of evidence.

Would you apply the same "cynicism" (or unbelief) to medicine, if someone told you that a certain chemical has a 95% chance of giving you cancer if you inhale enough, and a consensus of the worlds medics agreed?

In reply to FesteringSore: So, I hate to be the party-pooping revolutionary motherf*cker again, but did it never strike you as odd that politicians have been f*cking around with this shit for about two centuries now, and never seem to be able to do anything that makes any kind of difference at all?

I mean, really, comrades! What do you want here? Some more monetarist policies that suck the satanic cock of the market deity? Or some Keynesian mythology that pretends that capitalism can benefit everyone? It's time to get out of bed with your mommy and stage a revolution!

Let me explain.

There are no solutions to the problems thrown up by the Teletubbies outside of abolishing the Teletubbies. Abolish the f*cking Teletubbies is what I say! Who are the Teletubbies? They're your f*cking leaders. Stop following. It's the only way forward, my cousins. We're much better than this squalid confederation of idiots.

Imagine me as an incompetent leader with no qualifications. Somehow or other I got to the top. You saw my wrong moves, my lousy gear and my rope-drag. Do you trust my ability to set up a reliable belay?

In reply to mgco3: Hello. I don't think we've crossed swords yet. So before I get stuck into that ludicrous and insulting comment I'll give you the chance to retract it. You've got about 3 minutes. And I won't accept your retraction unless you can show me that you know the difference between a Marxist and a Leninist. The clock is running!

> (In reply to Chambers) I think you need accept people find your political views a bit weird and unrealistic. Splitting hairs over strands of far left thinking probably adds to this impression.

Now listen here, you...

I have no problem with my fellow man struggling with the notion that we might all get along a bit better than we do. I know that the very people who spend most of their time co-operating with other people in order to get stuff done think that most of humanity is incapable of co-operating in order to get stuff done. That's all fine.

But in the last half an hour I've been referred to as some very unpleasant things. Neither of which are true. You are suggesting that I'm on the far left. Nothing could be further from the truth. And I've been compared to Arthur F*cking Scargill. Which is like being compared to Hitler or Stalin. Deeply offensive. Nobody in my party wants to be the leader. Nor do any of us want to lead the working class. And none of us are followers, either. We don't advocate state-capitalism, and we don't advocate political violence. We don't support tyranny and dictatorship. Arthur F*cking Scargill does.

> (In reply to FesteringSore) Oh I'm very aware of the difference between the theory of Marxism and it's rather undetailed notions for a post revolutionary world, and the amoral dictatorship of Leninism.

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> In practice neither has a great track record of success. Which do you propose to be the ideal?

Actually, Marx's description of a post-revolutionary world are precisely as detailed as they could be. But that's another discussion. I'm glad that we agree on Lenin's development of state-capitalism in Russia. I suspect that your thinking is based on the complete misapprehension that the Russian revolution had anything to do with Marxism.

Marx's theory of Historical Materialism and his Labour Theory of Value have a great track record, in that they are as applicable today as they were 150 years ago. In fact, a grasp of Marxism is the only tool which can adequately explain why it makes not one iota of difference what clowns like Miliband - whose father, incidentally, was a Leninist - say when they are seeking a mandate to administrate capitalism. Once elected they run the system in the only way it can be run, which is in the interests of the capitalist class.

I don't propose any ideal. I leave that to utopians such as those who defend capitalism.

In reply to FesteringSore: I found Marx' description of a post revolutionary world vague at best and there is a point of view that you can't consider Marx an economist as he doesn't actually describe how an economy should function in any detail.
I have always been intrigued by his intentions behind 'To each according to his contribution'. Also his comments on what forced employment (unemployment would not be an option) are conveniantly ignored by many.

Now the real issue for you is the description of Soviet Leninist Russia as State capitalism. This I think is a cop out if not, where is the example of the communist state that has appeared. All those states describing themselves as Marxist have inflicted misery on their populations - Cambodia, the Great Leap Forward, marxist Leninist USSR and so on. To use the ploy 'noone knows what marxism looks like as noones tried it' is , in my opinion dodging the issue. If Marx indeeds describes an inevitable fall of capitalism is it possible to to have a socialist paradise or is post revolutionary tyranny inevitable as well? Is this problem the reason for Marx's near last words 'I am not a Marxist', as if to remind those around that he did not desire a future in a dictatorship

For the OP I think the price fixing is a bad joke by a formerly bad energy minister with no plan. If he thinks 4Bill profit on a 100Bill plus turnover is a 'rip off' then I'm glad he'll take that as interest on his money, but I wouldn't. Investment which is sadly needed is going to invariably suffer - I've seen quotes that 130Bill of investment are required to the UKs energy infrastructure - where is that meant to come from?

> (In reply to FesteringSore) I found Marx' description of a post revolutionary world vague at best and there is a point of view that you can't consider Marx an economist as he doesn't actually describe how an economy should function in any detail.

Marx certainly wasn't an economist in the sense that -say - John Maynard Keynes or Milton Friedman were. Whereas those two economists set out to describe ways in which capitalism could be controlled, Marx made it clear that it couldn't be controlled. Keynes and Friedman argued that government policy could affect, for example, the cycle of boom and bust and that government policy could affect the length and depth of recessions. Neither policy has been shown to work, and as another economist - darling of the free-marketeers, Hayek - pointed out, government intervention in markets would almost always make things worse. But these guys are concerned with concocting ways of tinkering with the system in order to attempt to ameliorate some of its ill-effects. And there's no split along party lines. Both Labour and Conservative governments have pursued both Keynesian policies along with Friedman's monetarist policies.

Marx, on the other hand, does not attempt to devise ways of improving capitalism. What he does attempt - and achieves - is to explain the way in which capitalism works. To discover - so to speak - what drives it. And I don't think there's been a better description of how capitalism operates and how capital is accumulated than Das Kapital.

It's true to say that Marx didn't say much about the society that might replace capitalism. And there are good reasons for this. First of all, Marx recognised that the development of the means of production that was mushrooming under the burgeoning industrial revolution would transform the nature of society. Any prediction about how developed the means of production would be by the time a socialist revolution established the new society would be mere conjecture. Furthermore, Marx argued that the emancipation of the working class must be the work of the working class itself. Workers could not be led to socialism, nor could it be imposed on them. They had to choose it consciously and democratically. To lay down a blueprint for people to live by would be inherently undemocratic.

But he does say a number of key things about how he thinks the new society might be organised, and I'll come to that in my next posting...

> I have always been intrigued by his intentions behind 'To each according to his contribution'. Also his comments on what forced employment (unemployment would not be an option) are conveniantly ignored by many.

What Marx actually says is 'From each according to his ability, to each according to his needs'. (Critique of the Gotha Programme) Also, as early as 1843, in his 'Economic and Philosophic Manuscripts' Marx argues that human emancipation - which he sees socialism bringing about - can only be achieved with the abolition of private property, money and the state. Moreover, in 'Wages, Price and Profit, he exhorts worker to 'inscribe upon their banners the revolutionary watchwords "Abolition of the Wages System" '. Now, I think that we can get a very clear picture of what Marx envisions the new society to be like from those three statements. (There are many more things that he says - about the free association of labour, for example - but these three will suffice for now.

Clearly, Marx is talking about a classless, stateless, moneyless society based on the common ownership of the means of production. A society in which no-one works for wages. In which people contribute to society according to their talents and abilities, and avail themselves of socially-produced wealth according to their needs.

My study of Marx - whilst extensive - is far from exhaustive. I have never come across anything that advocates forced labour. That sounds like Lenin to me, who wanted counter-revolutionaries to be forced to work with a gun at their heads. Perhaps you can put me right on that.

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> Now the real issue for you is the description of Soviet Leninist Russia as State capitalism. This I think is a cop out if not, where is the example of the communist state that has appeared.

I don't think it's a cop-out at all. We've argued since 1917 - even before the dust had begun to clear in Russia - that whatever happened there it would not be a socialist revolution. Marx himself argued that a backward, largely-agrarian, feudal society could not leap-frog stages of development into a socialist society. His point of view was that capitalism was a necessary precursor of socialism. Lenin himself recognised this. Indeed, even before the revolution he was arguing (Peasant's Congress, 1916)that sate-capitalism would be a step forward. So Lenin was clear that his objective was not the establishment od socialism.
The society that developed in Russia post-1917 bore all the hallmarks of capitalism. Class divisions, a growing army of wage-slaves, commodity production...

There can be no communist state. As I've already mentioned socialism - or communism - Marx used the terms interchangeably - will be a stateless society. Furthermore, it can't exist in one country. Just as capitalism is a global system, so too will the new society be.

> (In reply to Jim C)
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> It's fair enough to be cynical about what politicians and businesses with vested interests have to say.
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> But if climate scientists say that it's 95% likely that humans have caused the warming already seen and the implications for the future are x,y and z, then I don't see any justification for not believing them.
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> Would you apply the same "cynicism" (or unbelief) to medicine, if someone told you that a certain chemical has a 95% chance of giving you cancer if you inhale enough, and a consensus of the worlds medics agreed?

I have not said I believe (or disbelieve the science) what I am saying is it is a bit like unilateral nuclear disarmament, funny how we are not going to disarm when the other big hitters still have theirs, so why should we be cutting emissions unilaterally, and hurting ourselves financially and competitively ( our goods are more expensive made with expensive electricity)

The saving of the planet is not really in our hands, if the big players cut, then by all means we could contribute too, by cutting (as a token gesture) as that it all it is.

> (In reply to Jon Stewart)
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> I have not said I believe (or disbelieve the science)

The implication was there in "if you believe the warming argument", as it isn't an argument, it's just a fact, like smoking causing cancer, also using inverted commas for the term "greenhouse gases" (in a different sense to how I just did!).

> what I am saying is it is a bit like unilateral nuclear disarmament, funny how we are not going to disarm when the other big hitters still have theirs, so why should we be cutting emissions unilaterally, and hurting ourselves financially and competitively ( our goods are more expensive made with expensive electricity)

Yes, extremely difficult issue I agree. The argument for doing something is that we in the west have in the past produced a huge amount of the emmissions which put us in the situation we're in today and it's absurd to expect the big hitters to cut down without us 'leading by example' and taking responsibility for past emissions.

> The saving of the planet is not really in our hands, if the big players cut, then by all means we could contribute too, by cutting (as a token gesture) as that it all it is.

But if it's a token gesture that changes the policies of the big hitters in the long term, it's worthwhile. I guess the idea is that with green taxes, you stimulate development of low-carbon technologies, which when they are fully developed can be taken up by the big hitters much as the high carbon technologies before.

If you say, "it's not in our short term interests to spend money on green policies and they're not having a short term effect anyway" then you guarantee the worst outcome. If you lead by example and push the economy into developing lower carbon habits, there is at least a chance that something good will come out of it in the long term.

The people who think up these green policies aren't thick you know. They don't believe that cutting the UK's emissions is going to save the planet. They are trying to place the UK in most desirable position as a leader in a future low-carbon economy.

> But if it's a token gesture that changes the policies of the big hitters in the long term, it's worthwhile. I guess the idea is that with green taxes, you stimulate development of low-carbon technologies, which when they are fully developed can be taken up by the big hitters much as the high carbon technologies before.

Yes, if we sacrificed our economy to make zero difference to the world, I can imagine the big hitters changing their policy to exploit the economic collapse in Britain.

The green taxes are stimulating very little in the way of low carbon technology that can actual make a meaningful difference, but they are employing an awful lot of people (who will push for them) and are failing to present a real challenge to Big Oil/Coal/Gas (so they're also happy with them).

As it stands the big producers of CO2 are actually the ones spending megabucks on actual solutions to the problem, with both India and China spending big on next generation Thorium reactor designs. Perhaps after blackouts start to become common place in 10 years we'll go cap in hand to them for their reactors, and possibly nail the architects of our current green taxes and subsidy farming to their precious windmills.

I can't imagine China or India taking note of our wind and Solar-PV subsidy farming regime as they actually listen to people who can do maths.

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> Yes, if we sacrificed our economy to make zero difference to the world, I can imagine the big hitters changing their policy to exploit the economic collapse in Britain.

True, but I don't believe that we are sacrificing our economy.

> The green taxes are stimulating very little in the way of low carbon technology that can actual make a meaningful difference, but they are employing an awful lot of people (who will push for them) and are failing to present a real challenge to Big Oil/Coal/Gas (so they're also happy with them).

The green policies may be crap and not working. I don't know enough about them to make a judgment, I'm simply making the point that the simplistic view that they are there to save the world by making an infinitesimal contribution to cutting global emssions is nonesense, and that there is a sensible aim in it all. Whether or not they're good policies is a different matter, but the intent is correct IMO.

> As it stands the big producers of CO2 are actually the ones spending megabucks on actual solutions to the problem, with both India and China spending big on next generation Thorium reactor designs. Perhaps after blackouts start to become common place in 10 years we'll go cap in hand to them for their reactors, and possibly nail the architects of our current green taxes and subsidy farming to their precious windmills.

I'm not really convinced that the big hitters are engineering our way into a low-carbon future, nor am I convinced of the green policies devastating effect on our energy provision. But if I was convinced of these things, it would be a good point.

As is our research. What ever solution we end up having for our energy, if we want it to be carbon neutral, it is going to need a lot of innovation and new technology in a whole raft of areas. To fund that research and innovation you need a booming economy that you can tax to fund the research.

Sadly, even when our economy has been booming very little ends up in these areas. Unlike most R&D however, if we don't fund energy *and* we have to have a decarbonised future, pretending that we can't afford the funding now will cost us many, many times more in the future.

So perhaps it's worthwhile that Britain - barely a blip on the world's CO2 radar, ramps up its emissions in the short term to prop up the economy to fund a national scale (think Manhattan Project, several percent of GDP) R&D effort on energy. Fund 5 different fusion reactor designs beyond the funding level of ITER, fund everything going on energy storage, hammer down the cost of solar-thermal, hammer down the cost of aerogel insulation, get Starlite into manufacture, the works thermally. Get a single common design, inherently safe Thorium reactor designed for low staff operation. Get some of the amazing battery technology from labs and into production.

The carbon emissions saved in the long term would dwarf the short term emissions, and we'd be doing business with the world for decades.

> (In reply to Jim C)
>
> [...]
>
> As is our research. What ever solution we end up having for our energy, if we want it to be carbon neutral, it is going to need a lot of innovation and new technology in a whole raft of areas. To fund that research and innovation you need a booming economy that you can tax to fund the research.
>
> Sadly, even when our economy has been booming very little ends up in these areas. Unlike most R&D however, if we don't fund energy *and* we have to have a decarbonised future, pretending that we can't afford the funding now will cost us many, many times more in the future.
>
> So perhaps it's worthwhile that Britain - barely a blip on the world's CO2 radar, ramps up its emissions in the short term to prop up the economy to fund a national scale (think Manhattan Project, several percent of GDP) R&D effort on energy. Fund 5 different fusion reactor designs beyond the funding level of ITER, fund everything going on energy storage, hammer down the cost of solar-thermal, hammer down the cost of aerogel insulation, get Starlite into manufacture, the works thermally. Get a single common design, inherently safe Thorium reactor designed for low staff operation. Get some of the amazing battery technology from labs and into production.
>
> The carbon emissions saved in the long term would dwarf the short term emissions, and we'd be doing business with the world for decades.

Very good point - but wouldn't the most effective way be to contribute to an international R&D effort *and* cut emmissions (with the aim of getting agreement for the big hitterds to do the same in time)?

> I don't know enough about them to make a judgment, I'm simply making the point that the simplistic view that they are there to save the world by making an infinitesimal contribution to cutting global emssions is nonesense, and that there is a sensible aim in it.

I agree with your first part, and I wish I shared your enthusiasm about the aim. As far as I can tell the only real accomplishment to date is to create an industry that can farm money from bill payers pockets whilst contributing a minor fraction of our electricity, let alone energy, needs.

Well in terms of first world energy provision in the UK, the future is looking pretty bleak - according to the regulator. You could argue that this is due to a lack of investment in traditional generating capacity rather than the "green" taxes and subsidy farming, but I find it hard to believe so much energy has been put into the later without tackling the former, and the green initiatives seem to make most people think everything will be well.

In reply to FesteringSore: This energy debate is rather more interesting than the analysis of Marxism, but a separate interpretation of the Gotha Critique is that Marx replaces payment tied to prduction with payment tied to contribution. Lassalle's suggestion of equal distribution is dismissed. I do have the exact quote on the unemployment after the revolution, but it is clear that sitting around at home will not be an option if you expect to eat. Perhaps forced labour is an exaggeration.

> Very good point - but wouldn't the most effective way be to contribute to an international R&D effort *and* cut emmissions (with the aim of getting agreement for the big hitterds to do the same in time)?

My rather jaded view is that an international R&D project is almost guaranteed to degenerate into an oversized, inefficient behemoth that is riddled with politics, middle management, uncertainty and a bureaucratic approach to project management, the combination of which probably drives cost up 10x and guarantees nothing much will happen for decades. Critically the actual scientists end up getting marginalised, and a arge number of people end up having their jobs depend on the project which, much like a megacorp charity, would cease to exist if it ever fulfilled its function.

> (In reply to Jon Stewart)
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> [...]
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> My rather jaded view is that an international R&D project is almost guaranteed to degenerate into an oversized, inefficient behemoth that is riddled with politics...

Yes, it sounds idealistic to me too, but we're talking in the abstract here. I'm only suggesting funding really, not some Eden-project-science-dome the size of Wales where the best and brightest of every nation are sent to save the world!

> Yes, it sounds idealistic to me too, but we're talking in the abstract here. I'm only suggesting funding really, not some Eden-project-science-dome the size of Wales where the best and brightest of every nation are sent to save the world!

It's alright, it only takes a few £Bn in international funding to push a project into quagmire territory.

My personal feeling is that the big breakthroughs are likely to come from small, focused, skunkworks style projects - the right people, enough money, and focus. Luckily there are actually quite a few groups like this in the nuclear fusion field, but the UK government - and indeed governments of the wester world - just don't want to know, and they're running largely on private money, and none are in the UK.

> (In reply to Jon Stewart)
>
> [...]
>
> I agree with your first part, and I wish I shared your enthusiasm about the aim. As far as I can tell the only real accomplishment to date is to create an industry that can farm money from bill payers pockets whilst contributing a minor fraction of our electricity, let alone energy, needs.
>
> [...]
>
> Well in terms of first world energy provision in the UK, the future is looking pretty bleak - according to the regulator. You could argue that this is due to a lack of investment in traditional generating capacity rather than the "green" taxes and subsidy farming...

It just goes to show the problems with policy in general. You have a good aim, but everyone has short-term parochial motivation in their working lives and all you get out is unintended consequences. In some areas (education actually) I genuinely think that we should just give up having policies, but on the environment, I think it's so pressing that we should keep on trying, even if the current batch are complete shite.

We do these days; but take a look at the backgrounds of the people at the top of the heap that decide on the policies - our problem isn't the policies, but those behind them.

There are people who can achieve so much with relatively little funding, look at Elon Musk's accomplishments with SpaceX. Once upon a time people like him would achieve their dreams, grow old and retire into politics. These days people enter it their debating society at 6th form and then go on to learn to be a politician at university and then after a few years apprenticing they get dropped into a government post at the expense of a minister who had actually turned out to be capable but had the tenacity to grow old and not be one of the cool kids.

> but on the environment, I think it's so pressing that we should keep on trying, even if the current batch are complete shite.

Yes. The problem is ours are that kind of triple edged sword, they achieve nothing of importance, they divert funding from things that would, and they make most people feel good that we're doing something.

In reply to wintertree:
The problem with energy R&D over the last thirty years is simply stated; to a first approximation we (and most of the rest of the world) stopped doing it.

In 1980 the UK government spent about 0.1% of GDP on energy research, by 2003 this had fallen to 0.003%. It was a similar, but not quite as extreme, story, in other countries (with the exceptions of Japan and Korea). Of course, what happened was that energy markets were privatised and deregulated. You could regard this as a test of the theory that if the state stepped away the space would be filled by the nimble private sector.

Actually what happened was the nimble private sector decided to take the dividends instead. In 1994 the UK's privatised utility sector (including water as well as electricity and gas) spent £170 million on R&D, but by 2005 that had fallen to £15m. Of course, this is part of the bigger picture of privatised utility companies not wanting to invest.

In reply to FesteringSore: The energy companies are a bunch of wankers and they always will be. I'll leave you to your caveman like musings while I figure out how to turn my house into a power station ;-D

Many years ago I read a book from the 70s titled "The Next 10,000 Years" [1] and a central concept to the predictions was that the core measure of mankind's abilities is the energy that it can harness and employ. I think perhaps people have collectively forgotten this.

It also seems that state funding for research is increasingly based on inertia - just look at the public money cosmology, for example, receives. What is the point in understanding our place in the cosmos if we can't keep the lights on? There is no Brian Cox of the energy field, there is no government chief energyologist, and there is an increasing trend in state funding - UK and abroad - to funding less base research and just a few "Really Big Science" projects, which is a far cry from what is needed in energy.

People can complain all they want that the public utilities are not investing in research, but unless the profit they are allowed to extract from customers is linked to effective research spending, it is what companies are going to do. I don't see a problem with the state privatising large industrial plant, but any cost savings that brings should have been folded back into research by the state.

People need to move beyond blaming the utilities and look at the government for a consistent failure to invest in something so key to our future.

In reply to wintertree:
There is a government chief energyologist - he's David McKay, author of the excellent book "Sustainable Energy without the hot air", now chief scientific advisor to DECC (if I remember right it was Ed Milliband who appointed him), and successive government chief scientific advisors, from David King to John Beddington, have made as much noise as they can about the need to increase energy research (with a bit of success but from a very low base). The trouble is that the government scientists are civil servants, who can advise behind close doors but can't campaign; they have to live within the prevailing political orthodoxy which makes any kind of large scale state intervention not to be considered.

In reply to wintertree:
In terms of balance of research funding, it isn't cosmology that the money has shifted to, it's medical research. There's been a long term trend both in the UK and in the USA away from physical sciences and engineering, that energy research is part of, into life sciences and biomedical research. For example in the last comprehensive spending review science funding was flat in cash terms (i.e. declining in real terms due to inflation), but the Medical Research Council had its (very large) budget inflation protected, leaving everything else taking a cut.

You could take the view that prioritising medical research reflects the preferences of the rich and old, who are disproportionately politically powerful.

Thanks for the book link. Fascinating. I am glad that figure 20.23 confirms my view of the Jet Ski as one of the most offensive forms of transport, and it;s reassuring to see a well presented demolition of the "every little helps" mentality. It's going to take a while to read it all.

> In terms of balance of research funding, it isn't cosmology that the money has shifted to, it's medical research.

Yes. It's just cosmology is a nice example of an area that gets solid research funding for historical reasons whilst other areas - that make more sense to fund, and have a direct impact on maintaining our standard of living, are left to wither.

> You could take the view that prioritising medical research reflects the preferences of the rich and old, who are disproportionately politically powerful.

It also makes little sense if we don't find a way to power the living of all the lives we're extending. I'm all for the medical research not least as its fundamentally tied up in understanding more and more about biology, and the results of that - design and construction of machinery at the protein level - is one of the transformative technologies coming in my life time. Sadly it is not one that will address anything in the energy sphere. Plenty of other reasons to be for medical research as well, but I can appreciate the cynical view - although it would suggest the politically powerful are capable of long term thinking, even if only in a narrow view, which I find an increasingly unlikely proposition...

In reply to wintertree:
I don't blame the utilities, their duty is to maximise benefit to their shareholders. The trouble is that their shareholders - whether they are German pension funds or the French State - don't have any particular interest in whether the UK has sustainable and affordable energy supplies in the long term. The people I blame are the ideologues who still can't admit that there are some things that the market doesn't do a good job of delivering, and who still defend our current dogs' breakfast of an energy policy.

In reply to wintertree:
The other big shift in R&D funding that's happened in the last thirty years has been away from applied research to basic research (or to be more accurate applied research has been cut a lot more than basic research). This makes sense in our free-market political ideology - you can argue that basic research should be supported by the state because a single firm can't capture the benefit of generic scientific advances, so there's a market failure, but applied research will benefit the firm that carries it out so should be left to the market. We've tested this theory to destruction and found that firms in the current financial environment simply don't take the long-term view that would make them invest in R&D.

For nuclear power, for example, you could argue that we really don't need any more basic research, the problems are applied science or engineering problems. At the moment I suspect the biggest problem with nuclear is the industry's recurring failure to be able to complete projects on time and to budget.